However, Marx argues that capital is not a thing, but a social relation.

Means of production are not themselves capital, but only become capital when monopolised by a particular social class.

Land, on the other hand, is a thing, but cannot produce SV.

Labour, looked at in isolation from the social relations within which it is performed, simply does not exist.

Thus wage-labour and landed property cannot be seen as things either, but must be seen as “historically determined social forms”, both corresponding to capital and being part of capitalist society.

(Land contributes to the creation of use-values, but not to the creation of value, which is created by labour).

Surplus labour is necessary in all forms of society, to provide insurance against shortfalls and resources for expansion of production.

In capitalist society it assumes an antagonistic form, but does have the advantage of preparing the social and material conditions for a classless society in which the basis of freedom has been created.

Chapter 49 – On the Analysis of the Production Process

Profit and rent correspond to the total SV, wages to the variable capital.

Thus the total annual value created by labour equals the total of profit, wages and rent.

The value of constant capital is not re-created (since it is simply transferred unchanged), but it is a part of the total annual product.

Thus the total product appears to exceed the total revenue by C, thus there appears to be overproduction.

Correspondingly, the total new labour added appears to be consumed by the sum of the revenue, so where is the labour that can produce new means of production?

Marx resolves this by recapitulating his reproduction schemes, which shows that the total product does not simply resolve itself into the three revenues, but also includes a value component corresponding to constant capital used up.

The classics made the mistake of thinking that the value of the commodity resolves itself into the three component parts of profits, wages and rent:

because they could not understand the concept of constant capital

because they argued from the individual capitalist instead of seeing the system as a whole, thus they thought that the constant capital of the individual capitalists comprised the rent, profit and wages of some others

Chapter 50 – The Illusion Created by Competition

The total value produced is made up of constant capital value transferred, the variable capital and the total SV.

VC and SV together constitute the newly created value and take the form of revenues: wages, rent and profit.

Although the newly created value is equal to this sum, it is by no means the case that these three categories are constituent elements of the value: i.e. they refer to the manner in which the value is distributed, not to the manner in which it is produced.

(a rise in wages doesn’t increase the value of the commodity, but represents an erosion of SV).

So the value of the commodity is not to be determined by its ‘cost’ as the sum of wages, profit and rent.

Rather the value is the prior category and rent, profit and wages are portions of the value newly added.

abolishing the concept of value and retaining only the concept of price: but this presupposes the concept of money which can only be understood as the form of value. Otherwise the argument is purely circular: prices are explained in terms of other prices in an endless succession.

The illusion that the newly added value splits into three independent revenues is an illusion that arises through competition: it is the form in which the value of labour power and SV appear.

This happens because:

of the relation of revenues to ownership of the factors of production that gives rise to the illusion that it is these factors that create the revenues

prices do in fact vary with fluctuations of wages: the prices of commodities produced by capitals of below average oc rise with a rise in wages and fall with a decline

even if we ignore price fluctuations the illusion persists because the components of value appear to be preconditions of value rather than the other way around: to the capitalist the cost price, the cost of wages and constant capital, is given first, before the commodity and its value have been produced

the regulation of prices ultimately by movements of value is not something that takes place directly and so that is experienced as such by capitalists: he is not concerned with the realisation of value and SV

Chapter 51 – Relations of Distribution and Relations of Production

The apportionment of the produced value to different social categories are the relations or forms of distribution.

These relations appear “as natural relations, as relations arising directly from the nature of all social production, from the laws of human production in general”.

A ‘scientific’ approach reveals that production relations themselves are historically transitory and that relations of distribution are merely the other side of relations of production.

Wages are the revenue of the labourer only because the labourer enters capitalists production relations, because the MP confront the labourer as capital.

Moreover, this system of social relations of production reproduces itself and so the corresponding relations of distribution: the relations of distribution are indeed a moment of the process of reproduction of capitalist production relations.

The view that considers only the relations of distribution to be historically specific, but not the relations of production, rests on a confusion of the labour process and the valorisation process: the social relations of production are seen as purely technical relations.